- You need large volume to partner with a 3pl– This is a common assumption that many businesses make when partnering with a 3pl. They believe that outsourcing warehouse space requires a large amount of inventory to fill that space. The truth is, 3pl companies are “pay for what you need”. Their main goal is to help you scale your business. Selling you more warehouse space than needed would stagnate the growth of your business, and damage the partnership built between the two parties. More importantly, in seasons of high demand you will have the ability to increase your warehouse space at simple and easy to understand rates.
- You will lose control of business practices- At the end of the day,a 3pl company is simply there to fulfill your orders at a fast and efficient way. They consult and provide advice on how to best optimize your business practices. However, they do not have a percentage stake in your company. It is your product, and you decide how it is handled. 3pl companies are designed around customer service. This means that you will receive a personal manager that will guide you through the fulfillment process. They will allow you to tailor the packaging process, so you are sure your customers are receiving the product as intended. More importantly, 3pls will provide real time tracking of orders so you know that your orders are being delivered in a timely manner.
- Partnering with a 3pl is expensive- Most businesses fear partnering with a 3pl provider due to the upfront costs. You will have to pay for warehousing space that you use as well as the manpower and technology required to get the job done. However, on day one you will be running your business more efficiently saving you time and money. You will only pay for the warehousing space that you need. This is important in seasons of high sales as you will not have to rent an additional warehouse to fulfill your orders. Handling this process on your own can be detrimental for many reasons. First, warehousing space in 2021 is being paid at a premium. Real estate can be tough to come by with the increase in ecommerce that has resulted in higher prices for warehousing space. Second, you will have to split up your workers into separate warehouses which will hurt the overall efficiency of your business. If you grow your business to a large enough size, you will surely have to consider integrating an inventory management software to streamline your shipping and fulfillment process. This can be very costly and is something that can be easily avoided by partnering with a 3pl that already is trained in using the software. Another reason you will save money is because of cheaper shipping rates. 3pl companies have built relationships over many years with a multitude of carriers which has enabled them to negotiate cheaper shipping rates. They can schedule additional pickups if necessary and find solutions to just about any logistical challenge that may come up. These are just a few of the many ways you can save money by partnering with a 3pl provider.
- Order fulfillment is not complicated- This is a common assumption that many companies make when it comes to ordering fulfillment. They believe that order fulfillment is as simple as picking a product off a shelf and putting it in a box. They do not consider the challenges that can arise when fulfilling orders on your own. Changes in staff, inventory, warehouse space, severe weather, and other factors can cause complications in the order fulfillment process. These create logistical challenges that may not be able to be solved without additional investment of capital. Streamlining your fulfillment process is critical in saving money and delivering products in a timely manner. The guidance given by a 3pl company can be a priceless asset to your company in tailoring your product to meet your customer’s needs.
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